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Pandit Jawaharlal Nehru laid the foundation of modern India. The goals and objectives set out for the nation by Pandit Jawaharlal Nehru were:
Rapid Agricultural and industrial development. Rapid expansion of opportunities for gainful employment. Progression reduction of social and economic disparities. Removal of poverty and attainment of self reliance.
INDUSTRIAL POLICY
Industrial policy refers to government policy towards industries: Establishment Functioning Growth Management
Rules, regulations, principles, policy and procedure. Reflects the government attitude. Defines the respective roles of different sectors. State must play active role in development of industries.
Acceptance of the importance of both private and public sectors. Division of industrial sector: Industries where state had a monopoly. - arms and ammunition - atomic energy - rail transport Mixed sector - coal - iron and steel - aircraft manufacture - ship building
Planned national development To provide opportunity to the private sector to growth and expand Labour should participate in it enthusiasm
State
must play progressive role in the development of the industries provide justice, liberty, equality and fraternity
To
DIRECTION OF POLICIES
Improve the life standard and the working condition for the people
To prevent the private monopolies Concentration of economic power on the small number of individuals
First The industries whose development will be exclusive responsibility of the state
FEATURES
Private
sector must fit to the framework of social and economic policy of the state
Government
want to stress the role of small scale industries in developing the national economy. {Since they provide large number of employment }
Lack of resourses is very common due to the lack of power supply, water , and transport facilities .
It is one of the national aims of the nation
ESSENCE
Government
of India trust that this statement of the industrial policy will receive support from all section of the people and promote the rapid industrialization
2.
3.
It provided for a closer interaction between the agricultural and industrial sectors.
4. Accorded the highest priority to the generation and transmission of power. 5. An exhaustive analysis of industrial products was made to identify products which are capable of being produced in the small scale sector. 6. The list of industries exclusively reserved for the small scale sector was expanded from 180 items to more than 500 items.
7. Within the small scale sector, a tiny sector was also defined with investment in machinery and equipment up to Rs.1 lakh and situated in towns with a population of less than 50,000 according to 1971 census figures, and in villages. 8. Special legislation to protect cottage and household industries was also proposed to be introduced.
policy highlights on producing input needed by a large no of smaller units and making adequate marketing arrangement.
The
nucleus plant would also work for upgrading the technology of small units.
The
government would promote the development of a system of linkage between nucleus large plant and the satellite ancillaries.
To
The
investment limit in the case of tiny limits was enhanced to Rs.2 lakh of a small scale units to Rs.20 lakh and of ancillaries to Rs. 25 lakh.
Scheme for building buffer stocks of essential raw materials for the small scale industries was introduced for operation through the small industries development corporation in the states.
The
process and technology amid at optimum utilization of energy or the exploitation of alternative sources of every would be given special assistance .
Maximum
employment generation.
Promotion
Strengthen
of the agriculture base through agro based industries and promotion of optimum intersectorol relationship.
Promotion
quality.
On 24th July 1991, the government head Mr. P.V.Narasimha Rao, announced a new industrial policy which sought to drastically alter the industrial scenario in our country.
There are several fundamental departures in the new policy. The most important initiatives are with respect to the virtual scrapping of industrial licensing and registration policies, an end to the monopoly law and a more welcoming approach to foreign investments, apart from redefining the role of the public sector. These measures, long overdue, are welcoming as they would free the industry from regulations, most of which have outlived their utility.
OBJECTIVES
The objectives of the New Industrial Policy are: Encouragement to Indian entrepreneurship, promotion of
Development
of
Indigenous
technology
through
greater
Removing the regulatory system and other weaknesses. Increasing the competitiveness of industries for the benefit of the common man.
In pursuit of the above objectives, the Government has decided to take a series of initiatives in respect of the policies relating to the following areas:
A.
B. C.
D.
E.
Industrial Licensing Foreign Investment Foreign Technology Agreements Public Sector Policy Monopolies and Restrictive Practices
Trade
Industrial licensing policy and procedures have also been liberalized from time to time. A full realization of the industrial potential of the country calls for a continuation of this process of change. Major policy initiatives and procedural reforms are called for in order to actively encourage and assist Indian entrepreneurs to exploit and meet the emerging domestic and global opportunities and challenges. The industrial licensing system has been gradually moving away from the concept of capacity licensing. The system of reservations for public sector undertakings has been evolving to the ethos of greater flexibility and private sector enterprise has been gradually allowed to enter into many of these areas on a case by case basis.
B. FOREIGN INVESTMENT
Foreign investment would bring attendant advantages of technology transfer, marketing expertise, introduction of modern managerial techniques and new possibilities for the promotion of experts. In order to invite foreign investment in high priority industries, requiring large investment and advanced technology, it has been decided to provide approval direct foreign investment upto 51% foreign equity in such industries
Promotion of exports of Indian products calls for a systematic exploration of world markets possible only through intensive and highly professional marketing activities.
There is a great need for promoting an industrial environment where the acquisition of technological capability receives priority. In the fast changing world of technology, the relationship between the suppliers and the users of technology must be a continuous one.
With a view to injecting the desired level of technological dynamism in the Indian industry, the Government will provide automatic approval for technological agreements related to high priority industries within specified parameters.
The Industrial Policy Resolution of 1956 gave the public sector a strategic role in the economy.
After the initial exuberance of the public sector entering new areas of industrial and technical competence, a number of problems have begun to manifest themselves in many of the public enterprises. The most striking example is the take over of sick units from the private sector. Public sector units accounts for almost one-third of the total losses of central public enterprises.
With the growing complexity of the industrial structure and the need for achieving economies of scale for ensuring high productivity and competitive advantage in the international market.
Pre-entry scrutiny of investment decision not required. MRTP act is restructured by eliminating the legal requirements.
INDUSTRIAL LICENSING
License
is a written permission issued by the central government to an industrial undertaking stating such details as the location, the article to be manufactured, production capacity and other relevant particulars. is one of the few countries in the world where an entrepreneur is required to obtain an industrial license from the government before venturing into new business.
Ours
Checking unbalanced growth of industrial establishments and ensuring economic size of industrial units. Utilizing full capacity of large scale industries . Utilizing appropriate technology . Protecting of small scale industries against undue competition of large scale industries . Broadening the industrial base in India through new entrepreneurship development and ensuring industrial dispersion.
To
ensure regulation and development of important industries. ensure planning and future development of new undertakings .
To
Provisions of IDRA
Preventive Provision
Curative Provision Creative Provision
PREVENTIVE PROVISIONS
Three types of provisions are included in the preventive provisions .
CURRATIVE PROVISIONS
CREATIVE PROVISIONS
Creative provisions are positive in nature and involves cooperation between central government , industry, labor and consumers of goods produced by scheduled industries.
Items relating to an industries which is not included in the first schedule of the act . Items to be manufactured in an undertaking which does not come under the definition of a factory under the industries (D and R ) Act , 1951. Expansions which does not come under substantial expansion ,that is ,up to 25% of the existing capacity. Small scale units subject to certain conditions . Items which do not fall under the definition of new article.
Issue of licenses tends to give an exaggerated picture of industrial capacity. The process of consideration of applications at various levels and at various times contributes to delays and higher costs. There is very little follow up of licensing to see that approved projects fructify in a satisfactory phased schedule. One of the important purposes of industrial licensing of achieving regional dispersal of industries has not been achieved.
1.The Industries (Development and Regulation) Act, 1951 2.Industrial Licensing Policy 1951-60 3.Industrial Licensing Policies for 1960-70 4.Industrial Licensing Policies 1970-77 5.Industrial Licensing Policy 1980-90
The 1977 licensing policy provided thrust mainly in two respects: 1. Priority to small-scale, village, and tiny sector industries in future industrialization and 2. Geographical dispersal of industries from metropolitan centers to rural and backward areas.
pursuance of this policy, a new licensing policy was adopted, aiming at reviving the economic infrastructure inhibited by the infrastructural gaps and inadequacies in performance. basic objective was to transmit the fruit of industrialization and economic progress to maximum number of people, both in urban and rural areas.
The
In order to make Indian industry more competitive, the government felt the need for releasing the industry from bureaucratic obstructions and reducing the number of clearances. all new units with an investment upto Rs 75 crore in Centrally notified backward areas and Rs 25 crore in other areas were exempted from licensing. Import of capital good was allowed to the ttune of 30 percent of the plant and machinery. Export oriented units and units located in Export Processing Zones with an investment upto Rs 75 crore were de- licensed
Conclusion
In a planned economy, adequate control measures have to be exercised by the government for providing necessary direction to the industries, especially the private sector, to contribute their best towards the socio-economic objectives of the nation. Hence, the government control measures should be viewed in this light.